12AB vs 80G Registration: Income Tax Exemptions & Donor Benefits Explained
Understanding the distinct roles of Section 12AB (for NGO income tax exemption) and Section 80G (for donor tax deductions).
Executive Summary
Section 12AB and 80G are separate provisions under the Income Tax Act, 1961. 12AB exempts the NGO from paying income tax on its surplus, while 80G enables donors to claim a 50% deduction on their donations.
Who It Applies To
- All newly incorporated Section 8 companies, trusts, and societies
- NGOs needing to renew provisional 12AB/80G approvals into 5-year regular registrations
- Founders seeking to issue tax-deductible donation receipts
Documents Checklist
- Certificate of Incorporation / Registration Certificate & MoA/Deed
- PAN card of the NGO entity
- Detailed Note on charitable activities conducted or planned
- Audited accounts or balance sheets for the last 3 financial years (if applicable)
- List of governing body members, trustees, and directors with PAN and contact details
- NITI Aayog NGO DARPAN registration copy
Statutory Process
Step 1: Step 1: File Form 10A online on the Income Tax e-filing portal to receive Provisional Registration (valid for 3 years).
Step 2: Step 2: Start charitable activities in accordance with approved objects.
Step 3: Step 3: Apply for regular 5-year registration using Form 10AB at least 6 months prior to expiry of provisional order or within 6 months of commencement of activities.
Step 4: Step 4: Provide verification records and clarification documents to the Principal Commissioner of Income Tax (Exemptions).
Step 5: Step 5: Receive final 16-character Unique Registration Number (URN).
Frequently Asked Questions
Can we apply for 12AB and 80G simultaneously?
Yes! Both Form 10A applications can be filed simultaneously right after obtaining the NGO PAN card.
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